- Insurance firm Hiscox estimated natural catastrophes occurring this year were likely to cost the industry $100 billion. High claims were likely to push up some premium prices by 50%. Claims following hurricanes Harvey, Irma and Maria were likely to cost $225 million, the group said.
LONDON – International insurance firm Hiscox said natural catastrophes in 2017 had cost the industry an estimated $100 billion, and could push some insurance prices up by 50%.
In its report for the first nine months of the year, Hiscox pointed to the destruction caused by hurricanes Harvey, Irma and Maria, for which it estimated combined net claims would total $225 million.
Hiscox said: “It is not surprising that we are seeing signs of a hardening market.” The company estimated rising insurance prices of between 10-50% in some lines of business in the US.
“2017 is turning out to be an historic year for catastrophes and Hiscox’s first priority is to help our customers get back on their feet,” said CEO Bronek Masojada.
“Our long-held strategy of balance and diversity was built for this environment, as our retail businesses provide stability when volatility impacts the big-ticket areas. Our balance sheet is strong, and we are in a good position to capitalise on changes in the market,” he said.
Although Hiscox said claims arising from the Mexico earthquakes and California wildfires were “not expected to be material for the group,” they too were likely to push up premium prices.
Overall, gross written premiums for the group grew by 12.4% in 2017 to £2,088.8 million, up from £1,858.2 million in 2016. Growth was driven by its US arm, which saw gross written premiums rise 29.2%, a trend expected to continue throughout the fourth quarter of the year.
Meanwhile, Hiscox UK and Ireland increased gross written premiums by 12.2%, and Hiscox Europe by 11.2%. Hiscox Europe benefited in particular from the group’s experience in cyber and classic cars, it said.